The U.S. Federal Maritime Commission (FMC) has ruled that Israeli shipping company ZIM violated U.S. shipping law and must pay approximately $3.7 million to Samsung Electronics America (SEA).

The ruling follows SEA’s October 2022 complaint against ZIM, which alleged “unreasonable practices, retaliation, refusal to deal, and improper invoicing for home appliance shipments.”

Specifically, SEA accused ZIM of shifting responsibility for detention and demurrage (D&D) fees in warehouse-to-door deliveries and cited nearly 10,000 improper charges involving around 3,000 containers.

SEA initially sought over $12 million in damages: $10.8 million for miscellaneous charges and $1.4 million for additional costs such as legal fees.

The dispute, which the FMC described as “complex and difficult to resolve,” concerned 9,984 individual D&D charges across 2,980 containers shipped between July 2019 and December 2022.

Most of the shipments took place before the Ocean Shipping Reform Act (OSRA) of 2022, which established the FMC’s expedited billing complaint process.

ZIM argued that its application of vessel space limitations on SEA’s cargo contributed to delays and additional D&D charges. It further claimed SEA bore responsibility for some fees, pointing to logistical factors like trucker availability, port conditions, and consignee readiness.

ZIM explained that determining liability required reviewing emails and evidence for each container's delay, many of which were allegedly caused by third parties.

However, the FMC rejected ZIM’s argument that holding cargo until debts were paid was justified. Still, SEA failed to prove ZIM was responsible for all D&D charges. Some fees, the FMC concluded, resulted from SEA’s consignees being unable to receive the cargo.

Thus, applying D&D charges in carrier/warehouse delivery scenarios was not deemed an unreasonable practice. The FMC also noted that SEA provided no evidence of retaliation, refusal to deal, or violations of OSRA billing requirements.

The Commission found $3,680,339 in D&D charges to be unlawful under the Shipping Act and ordered all other pending motions and requests in the case dismissed, closing the proceeding.

Meanwhile, SEA has other ongoing cases with the FMC, including high-profile disputes against COSCO, OOCL, SM Line, and HMM. The latter case alleges around 96,000 improper D&D charges, making it the largest to date.